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Court of Appeals suspends lawyer for mishandling trust account

The state’s top court has indefinitely suspended a Frederick lawyer who commingled personal and client funds in his attorney trust account and failed to maintain records that accurately reflected the account’s status.

A divided Court of Appeals found that Willie James Mahone’s misconduct did not warrant disbarment — despite his record of violating the Maryland Lawyers’ Rules of Professional Conduct on three separate prior occasions — because he did not act with malice or for personal gain and later expressed remorse.

“It is clear that Mahone did not act with a dishonest or selfish intent and there is no evidence that any of Mahone’s clients lost money due to his mismanagement,” Judge Sally D. Adkins wrote for the court’s majority. “Furthermore, there is no evidence that Mahone’s mismanagement of his attorney trust account impacted the quality of his legal representation, and Mahone has taken steps to remedy his admittedly ‘sloppy recordkeeping.’ He has resolved to more closely examine his monthly statements and has contacted an accountant who agreed to monitor his attorney trust account.”

Mahone did not immediately return a message left at his firm on Friday. Glenn Grossman, Bar Counsel for the Attorney Grievance Commission, declined to comment on the ruling.

The disciplinary investigation began when Sandy Spring Bank notified the Attorney Grievance Commission of an $86 overdraft of Mahone’s attorney trust account in February 2014, according to the opinion, filed Dec. 19.

Bar Counsel sent Mahone a letter requesting an explanation of the overdraft, as well as client ledgers, monthly bank statements, deposit slips and canceled checks from November 2013 to March 2014. Mahone responded 10 days after the date by which Bar Counsel had requested an answer and did not provide the documents, the opinion states.

Mahone then failed to respond to three follow-up letters from Bar Counsel sent in April, November and December 2014, the opinion states. As a result, Bar Counsel subpoenaed Sandy Spring Bank for Mahone’s trust account records, which showed negative balances in nine client matters, earned attorney fees deposited into nine client trust accounts, a $1,500 cash withdrawal and several transfers from checks Mahone had made out to himself.

Bar Counsel in April 2015 again asked Mahone for an explanation of the trust account transactions, but the lawyer did not respond, even though he was granted a two-week extension, the opinion states. Mahone eventually responded in a letter that he would provide the requested information by June 1, but he still had not given Bar Counsel the requested documents nor a satisfactory explanation several months later.

The Attorney Grievance Commission filed a petition for disciplinary or remedial action against Mahone last February. When Bar Counsel deposed Mahone in June, he admitted he had commingled funds in violation of the Maryland Lawyers’ Rules of Professional Conduct and failed to create and maintain proper trust account records.

After hearing oral argument in November, the Court of Appeals found that Mahone had broken multiple rules but had not acted with the intent to defraud his clients, which mitigated his misconduct.

But Judge Shirley M. Watts, in a concurring and dissenting opinion, said disbarment would be a more appropriate sanction, largely due to Mahone’s history of misconduct, including a previous indefinite suspension and two reprimands.

“This Court’s action in indefinitely suspending Mahone represents the fourth occasion on which he has been sanctioned for misconduct,” she wrote. “The continuum of attorney grievance cases demonstrates that Mahone was not deterred by his prior encounters with Bar Counsel. And, the frequency of his misconduct indicates that he would pose a threat to future clients.”

Judge Robert N. McDonald joined Watts in the dissent.

The case is Attorney Grievance Commission v. Willie James Mahone, Misc. Docket AG No. 82, September Term 2015.

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